U.S. businesses large and small have seen economic gains from EPA's use of the 40-year-old federal Clean Air Act, according to an analysis released this week that aims to counter arguments by industry groups that the law is anti-business.
The report, carried out by environmental consulting firm M.J. Bradley & Associates, is based on data from previous EPA and independent calculations on the costs and benefits of Clean Air Act compliance.
"The Clean Air Act has proven to be a very good investment," the authors concluded.
John Arensmeyer, founder and CEO of Small Business Majority, a small business advocacy group, said he felt it was time to air the figures, now that Congress has failed to pass a climate bill and attention has turned to the EPA to use its power to slow global warming.
"The focus of the [climate change] debate has moved to the EPA enforcement of the Clean Air Act," Arensmeyer told SolveClimate News. "We felt it was important to get some information out about that."
The Sausalito, Ca.–based Small Business Majority, which has no membership and is foundation-funded, claims it is focused on solving the problems of the nation's 28 million small businesses.
Arensmeyer, a former tech entrepreneur, said "the enforcement of the act creates a whole bunch of economic opportunities for small business" at a time of fiscal distress.
"We need to be focused on clean energy," he said. "That's really where the economy is going." And opponents "don't really have a lot of evidence" that clean-air rules are bad for bottom lines.
Clean Air Act Under Attack
The report comes at a time when the Clean Air Act, the crown jewel of U.S. environmental and health law, is under heightened attack by industry groups and conservatives on both sides of the aisle.
The law, passed in 1970, directs EPA to create and enforce rules on a range of air pollution problems, from acid rain to smog, motor vehicle efficiency and ozone layer protection.
EPA conducted two cost-benefit reviews of the act at the end of the 1990s. The results revealed that between 1970 and 1990, the price tag of cutting air pollutants was a massive $523 billion. The costs, however, were offset by $22 trillion worth of benefits to human health and worker productivity, the agency said, returning $42 in benefits for every dollar spent to comply.
The agency predicted that economic benefits from 1990 through 2010 would total $690 billion in 1990 dollars, compared with compliance costs of $180 billion—for a margin of 4 to 1.
But opponents are hardly convinced. With EPA in the midst of unleashing a flurry of new Clean Air Act rulemaking to control almost every source of air pollution—including heat-trapping gases—adversaries are cautioning against government overreach.
In recent months, EPA announced stricter standards for sulfur dioxide and nitrogen dioxide and unveiled new regulations for smog-causing pollutants. In November, it is expected to release ambitious—and potentially expensive—standards for ground-level ozone.
In a draft rule from January, the agency proposed shrinking the ozone standard to somewhere between 60 and 70 parts per billion (ppb), from the Bush Administration's 85 ppb to 75 ppb.
Job Killer, Manufacturers Say
Industry claims the costs of compliance would shutter businesses and kill jobs.
A September report by the Manufacturers Alliance for Productivity & Information (MAPI), a research group in Arlingon, Va. that does no lobbying on policy issues, said the new ozone rule would reduce U.S. GDP by $676.8 billion in 2020 and result in 7.3 million lost jobs throughout the economy during the same period.
Don Norman, an economist with MAPI and the report's author, said the reason for this is that the manufacturing sector would need to make huge investments to comply, and the wider economy would suffer. "The impact on the economy goes beyond the direct impact of the manufacturing sector," Norman told SolveClimate News.